Paper Title
How Investors Attitudes Shape Stock Market Participation in The Presence of Financial Self-Efficacy
Abstract
Purpose- The purpose of this empirical study is to investigate how investor’s money attitudes shape their stock market participation (SMP) decisions.
Design/Methodology/Approach- This study followed Theory of Planned Behavior (TPB) and a questionnaire survey was done to collect the responses from active investors from Pakistan Stock Exchange. The software AMOS 26 and SPSS 22 were used for the analysis of hypothesized relationships among the constructs. Confirmatory Factor Analysis (CFA) was conducted to check the interrelation of the variables and validity of the of the constructs.
Findings- This research concluded that investor’s money attitudes are significant to affect their stock market participation decisions. Further, it was found that risk attitudes mediate the relationship between money attitudes and stock market participation. Moreover, financial knowledge and financial self-efficacy positively moderate the relationship between money attitudes and stock market participation.
Originality/Value- This research is one of the first attempts in Pakistan Stock Market to study the money attitudes of investors and introduce financial self-efficacy (FSE) as moderating construct between money attitudes and stock market participation.
Limitations/Future Directions- (1) The sample size for this study was 250 respondents which can be increase and the same relationships can be tested by using large sample (2) This study used money attitudes as predictors of stock market participation but many other variables like personal value can also be taken to investigate their influence on stock market participation.
Keywords - Money Attitudes, Stock Market Participation, Risk Attitudes, Financial Self-Efficacy, Financial Knowledge.